The Nikkei 225 index continued to maintain its upward momentum on Thursday, buoyed by gains in semiconductor stocks. However, market sentiment remained cautious as investors await the earnings report from U.S. chipmaker Nvidia, which is expected to set the tone for the global tech sector. The rising yen also poses a challenge, tempering the market’s overall optimism.
The Nikkei closed at 32,500, up 0.4% from the previous day, marking a steady rise driven by robust performances in the technology sector. Semiconductor giants such as Tokyo Electron and Advantest led the charge, riding the wave of global demand for chips. Market analysts suggest that the upcoming Nvidia earnings report could significantly influence investor sentiment, not just in Japan but across global markets.
“Nvidia’s results are crucial,” said a senior market strategist at a leading Tokyo brokerage. However, it could further propel semiconductor stocks, boosting the Nikkei. If the earnings match or exceed prospects, any disappointment could lead to a sell-off, especially considering the sector’s recent strong run.
Despite the positive market trend, the strengthening yen has emerged as a potential headwind for Japanese exporters. The yen appreciated to 130.5 against the U.S. dollar, its highest level in three months. A stronger yen typically reduces the profitability of Japanese companies that rely on exports, casting a shadow over the market’s gains.
“The yen’s appreciation is a double-edged sword,” noted another analyst. “While it reflects global confidence in the Japanese economy, it also makes Japanese goods more expensive abroad, which could impact export-driven companies.”
As the market braces for Nvidia’s earnings, investors are also keeping a close watch on currency movements, aware that the yen’s trajectory could play a pivotal role in shaping the Nikkei’s near-term outlook.